03-08-2013, 12:07 PM
I think something being missed is the emphasis being put by Mr Duma on PNGs inability to get its own project negotiating done. Read just this part:
"n Any agreements with InterOil to be conditional on the state executing all agreements necessary to develop its (the government's) commercialisation project;
n Acquisition of additional interest in the licence above the state’s back in entitlement be negotiated and executed by any party designated by the state; and (again, this is the government's responsibility)
n The 2009 project agreement shall remain on foot and enforceable until all the condition precedents in the 50-50 proposal become unconditional. (once again, this option is being explored by the government and unless they can get it figured out and how they'll pay for it, the option can't be put in the agreement)
“NEC has appointed a ministerial gas committee headed by me to progress this InterOil proposal with the assistance of the state negotiating team,” Duma said.
“The state negotiating team is yet to report back to NEC through the ministerial gas committee on the outcome of these negotiations. (again, if they can't get it figured out, O'Neill will likely say its not doable as far as the State taking 50% and say "Proceed with the 3.8 mtpa startup and we'll do the standard opt-in and take some of our allocation in-kind)
“Until such time the state negotiation team reports back to NEC, any public comments by InterOil that the government has given approval to commercialise a 3.8 million tonne per annum facility is grossly misleading. Same
“Until such time the conditions precedent in the 50-50 proposal are agreed to by the state and InterOil and met, the InterOil LNG project agreement of 2009 between the state and InterOil remains binding upon InterOil.” Same, but Duma trying to use leverage.
So what I think may be going on is that O'Neill charged these guys with getting things negotiated. The "beyond our control" comments means they can't fund it themselves (the 50-50 pony up at "commercial rates"
and can't secure the funding elsewhere right now. I also think that it is IOC who finally said that enough time has passed for that option to be finalized and stated that Feb 28th was the deadline for all bids (possibly including 50-50 options which would be non-conforming bids possibly). The government (mainly Duma I think) has wanted more of these projects as far as ownership. IOC said OK, but we can only wait so long and your amount above 22.5% must be at commercial rates. PNG has been trying, but time really has been short for them to do that. Both sides have been working hard, but it's decision time and PNG may have to do the 50-50 on the next project.
and can't secure the funding elsewhere right now. I also think that it is IOC who finally said that enough time has passed for that option to be finalized and stated that Feb 28th was the deadline for all bids (possibly including 50-50 options which would be non-conforming bids possibly). The government (mainly Duma I think) has wanted more of these projects as far as ownership. IOC said OK, but we can only wait so long and your amount above 22.5% must be at commercial rates. PNG has been trying, but time really has been short for them to do that. Both sides have been working hard, but it's decision time and PNG may have to do the 50-50 on the next project.